On April 19, 2011, the Supreme Court heard argument in American Electric Power Co. v. Connecticut (AEP),1 a lawsuit brought by several states and private land trusts against a handful of energy companies, seeking to use the rubric of "public nuisance" to obtain an injunction capping defendants' carbon dioxide emissions and ordering specific reductions over a period of at least 10 years.
This case is one of several federal lawsuits that attempts to use the public nuisance doctrine in novel ways to address global warming in the absence of what plaintiffs consider appropriate regulation. These global warming nuisance cases have been met with skepticism by federal trial judges, all of whom have dismissed them as raising complex and contested policy issues beyond the judiciary's institutional competency and constitutional authority. In AEP, a two-judge panel of the United States Court of Appeals disagreed and held that the case could proceed. In granting certiorari, the Supreme Court indicated it will weigh in on whether global warming nuisance cases are properly maintained in federal court. At argument, just about every justice seemed uncomfortable with the implications of this sort of case, but no clear consensus emerged about what grounds, if any, a majority of the Court would coalesce around.
AEP Is One of a Series of Public Nuisance Climate Change Suits
Over the past decade, various plaintiffs have sought-so far unsuccessfully-to use creative public nuisance theories to impose emissions caps or enormous damages on alleged contributors to global climate change. In addition to AEP, two other major federal suits have been brought in Mississippi and California.2 In Comer v. Murphy Oil, USA,3 a class of Mississippi residents sued more than 30 energy companies for damages from Hurricane Katrina, which allegedly was intensified by global warming. In Native Village of Kivalina v. ExxonMobil Corp.4, a village sued dozens of oil, energy and utility companies for $400 million in damages for coastal erosion in Alaska allegedly caused by global warming.
In all three cases, the district courts concluded that the cases were nonjusticiable. In AEP and Comer, panels of the Courts of Appeals for the Second and Fifth Circuits, respectively, entered opinions that would permit the cases to proceed. In AEP, after rehearing was denied by the Second Circuit, certiorari was granted. In Comer, the Fifth Circuit agreed to rehearing en banc and vacated the panel opinion, but subsequently dismissed the appeal for lack of quorum. That dismissal was left undisturbed when the Supreme Court recently denied the plaintiffs' petition for mandamus. The Ninth Circuit has yet to hear argument in Kivalina, and it likely will have the Supreme Court's guidance in AEP about whether cases seeking to assign responsibility for and limit global warming are properly maintained in federal court.
AEP Raises Numerous Doctrinal Questions
In AEP, several states and land trusts allege that the five named companies' greenhouse gas emissions constitute a public nuisance under federal common law. This case is perhaps most notable because of the remarkable remedy sought. Rather than damages, the plaintiffs asked a federal judge to order a handful of energy companies operating in 20 states to "abate" their alleged "contribution[s]" to global warming "by requiring [them] to cap [their] carbon dioxide emissions and then reduce them by a specific percentage each year for at least a decade." Complaint ¶ 186,Connecticut v. Am. Elec. Power Co., No. 04-05669 (S.D.N.Y. July 21, 2004).
The Southern District of New York concluded that the case presented a non-justiciable political question under Baker v. Carr, 369 U.S. 186 (1962) because, among other things, its resolution would "require identification and balancing of economic, environmental, foreign policy, and national security interests." In the Second Circuit, a two-judge panel reversed. The panel found that the plaintiffs' case, which it characterized as an "ordinary tort suit," was well within the competence of federal courts and was not barred by the political question doctrine. The panel went on to consider alternative arguments presented by the energy companies in support of affirmance and concluded that the plaintiffs had constitutional standing, that the federal common law of nuisance provided a cause of action and that the claims were not displaced by Congressional or Environmental Protection Agency (EPA) action.
Applying a relaxed analysis at the pleading stage, the panel found that the state plaintiffs had standing. The court determined that they satisfied the standard in Lujan v. Defenders of the Wildlife, 504 U.S. 555 (1992), reasoning that (1) the court in Massachusetts v. EPA recognized that alleged future injuries, such as damage from rising sea levels, were actionable; (2) causation is established as long as defendants release a pollutant that "contributes to the kind of injuries alleged by plaintiffs" and (3) redressability only requires that the relief requested would lead to some slowing of global warming, not complete cessation. The panel disagreed with the district court and the energy companies about the difficulty of the issues presented, finding that courts regularly apply tort law doctrines like nuisance and often engage in highly complex fact-finding. The Second Circuit denied a petition for en banc rehearing, and the defendants sought a writ of certiorari from the Supreme Court.
The petition for certiorari presented three questions: (1) whether states and private parties "have standing to seek judicially-fashioned emissions caps on five utilities for their alleged contribution to harms claimed to arise from global climate change caused by more than a century of emissions by billions of independent sources;" (2) whether a cause of action to cap carbon dioxide emissions can be implied under federal common law; and (3) whether "claims seeking to cap defendants' carbon dioxide emissions at 'reasonable' levels" are barred by the political question doctrine because they would be governed by "judicially discoverable and manageable standards" or could be resolved without "initial policy determination[s] of a kind clearly for nonjudicial discretion."
The Obama Administration took a position in this case because the Tennessee Valley Authority (TVA) is a named defendant. At the certiorari stage, the United States supported what it characterized as "limited intervention by the Court" in part because of the effect of the Second Circuit decision on additional and future litigation. The United States urged remand for consideration of the case under the prudential standing doctrine and to evaluate whether EPA action after the panel opinion had displaced the claims.
At the merits stage, the energy companies renew arguments that the case is non-justiciable. They argue that the states and private land trusts lack standing to maintain their suit. In particular, the energy companies highlight the traceability and redressability prongs, and argue that they are not met here because the "complaints assert that these defendants have contributed to climate change generally through their emissions, and that climate change contributes generally to increased risks of injuries." Pet. Br. 18 (emphasis in original). Notably, the Obama Administration's position on Article III standing departs from that of the energy companies: "although the question is not free from doubt, the allegations advanced by the coastal States in their capacity as sovereign landowners are sufficient to survive a motion to dismiss under this Court's recent decision in Massachusetts v. EPA." Br. of United States 25.
The energy companies also argue that this case cannot proceed because nuisance suits for contributions to climate change are not cognizable under federal common law, and in any event have been displaced by EPA action. AEP and the other petitioners point out how rare it is for courts to create federal common law at all and emphasize its particularly infrequent use to create causes of action. The United States writes that "the Court need not determine whether federal common law should, absent displacement, provide a cause of action for public nuisance against persons and entities that contributed to climate change." Br. of United States 43. Instead, the United States argues that any common-law claims have been displaced by EPA actions taken and being considered under the Clean Air Act. Id. at 44-53.
Finally, the energy companies argue that the case presents nonjusticiable political questions. The United States does not urge its use, but states that the Court "could properly rely on the political-question doctrine to direct dismissal of this case."Id. at 39. Elaborating, the United States notes that "the myriad questions associated with developing a judgment about reasonable levels of greenhouse-gas emissions from defendants and the broader industry of which they are a part are more properly answered by EPA." Id. at 19.
AEP and the other petitioners received substantial amicus support from, among others, the American Farm Bureau Federation, the National Association of Home Builders, the Association of Global Automakers, the U.S. Chamber of Commerce, the Chairman of the House Energy and Commerce Committee and two other Congressional leaders on environmental issues and 23 states who disagree with those that filed suit.
On the other side, the states and private land trusts argue that this case is suitable for judicial resolution, framing the case as a routine common law tort suit, albeit on a larger and admittedly more complex scale. They argue that this sort of litigation is well within the experience and ability of federal judges and assert that it is amply supported by earlier interstate pollution cases brought under the public nuisance doctrine. They urge the Court to permit the case to proceed, allowing difficult causation questions to be addressed at the merits stage. While the states and their supporters admit that no standard or rule presently governs carbon dioxide emissions from the energy companies in this case, they argue that the Court can remand the case to the trial court to see whether and how the EPA's climate change regulations might displace or alter their asserted cause of action. Respondents are supported by nine amicus briefs on behalf of numerous parties, including tort and environmental law professors, a collection of religious groups, several environmental interest groups and four additional states supporting their position.
At argument, the justices seemed uncomfortable with the implications of this lawsuit. The questioning reflected a keen awareness on the part of many of the justices of the difficulties a trial judge would face in adjudicating this sort of claim, and seemed to be skeptical of the states' argument that the task would be complicated but well within the district court's abilities. Some members of the Court seemed eager to reach the merits and go beyond the standing doctrine, perhaps to ensure that the courts need not wrestle with inevitable subsequent suits alleging similar claims. Several searched for some concrete guidance on when displacement of federal common law by EPA action could occur; in other words, where particular EPA action is not imminent or mandated by a statute, can displacement occur prior to the issuance of binding rules on these energy companies? The government's attorney, acting Solicitor General Neal Katyal, received some probing of his arguments on prudential standing, which several justices questioned as doctrinally misplaced. The justices questioned the attorney arguing for the States about whether any limiting principle could be applied to who could be liable for global warming, and seemed unconvinced by her assurance that only "significant" contributors could be held responsible.
This Case Has Important Implications for American Businesses
AEP and similar cases seek to change the way energy is produced, regulated and sold in this country by requiring energy companies and others to internalize what some argue are the externalities of activities that produce greenhouse gases. Indeed, the states' complaint in AEP notes the desirability of having companies implement "practical" options such as "changing fuels" and "increasing generation from . . . wind, solar" and other sources that they predict will "reduc[e] carbon dioxide emissions without significantly increasing the cost of electricity." (emphasis added).
If this type of case is permitted to proceed, it seems certain that there will be additional litigation and it will not necessarily be limited to energy companies. Because of the seemingly boundless chains of causation at issue in affixing responsibility for global climate change, the possibilities for future litigation seem almost endless: any company or entity that "contributes to" global warming through the emission greenhouse gases can be called into court by any party allegedly harmed by the consequences of this decidedly global, complex and imperfectly understood phenomenon. As the Obama Administration succinctly stated at the certiorari stage, "action by this Court would meaningfully affect an emerging category of litigation over greenhouse-gas emissions that implicates myriad plaintiffs and defendants." Br. in Support of Cert. at 10.
The Court Will Offer Guidance on the Viability of Global Warming Litigation
The Supreme Court is poised to provide needed guidance to courts confronted with pending and future global warming nuisance cases. AEP provides the Court an opportunity to clarify the effects and limitations of Massachusetts v. EPA, as well as several fundamental justiciability doctrines that shape the role of courts in this country. At oral argument, justices across the bench voiced skepticism about the wisdom and propriety of this case proceeding, and clearly were engaged in the substantive and varied doctrinal issues presented by the states' theory. No consensus emerged for an outcome or particular basis for decision, though the Court could dispose of the case on several grounds.
In light of the many doctrinal issues presented in this case, it is difficult to predict which justices might agree to dismissal on any of the many grounds raised, though no justice seemed inclined to let this novel case proceed. The many aspects of this case that distinguish it from the 5-4 decision in Massachusetts v. EPA, make it an imperfect predictor of the outcome here. With the recusal of Justice Sonia Sotomayor, if the Massachusetts v. EPA alignment repeats here-with Justice Elena Kagan taking the place of Justice John Paul Stevens and Justice Anthony Kennedy voting to permit the states to maintain such actions-the Court would produce a 4-4 split, which would leave the Second Circuit's decision intact. Based on the questioning at oral argument, such an outcome does not seem very likely; enough justices seemed troubled by the case and its implications that there is a good chance the Court will reverse on one or more grounds.
Whatever the outcome, it is likely that the Court or some portion thereof will attempt to clarify the meaning of the 2007 decision in Massachusetts v. EPA. In doing so, and in addressing the many other issues raised to challenge the justiciability of global warming nuisance suits, the Court will offer much-needed guidance about the limits of the judiciary's institutional and constitutional competence to fashion and impose judicial remedies for harms allegedly caused by global warming.
A decision is expected by the end of the Court's term in June.